Both new and existing home sales numbers for April reflect the inflexible economic law that when there is a supply shortage relative to sudden demand, prices will pop
All regions of the nation showed strong existing home price gains in April, according to the National Association of Realtors®statistics released last week. New home prices jumped to record highs, according to U.S. Commerce Department figures. Total homes sold remain below actual demand for both new and existing homes. Demand is driven by low mortgage rates, new household formation, and the slowly recovering economy.
Resale activity is 9.7% above the 4.53 million-unit level of one-year ago April 2012. Lawrence Yun, National Association of Realtors® chief economist, said the market is solidly recovering. “The robust housing market recovery is occurring in spite of tight access to credit and limited inventory. Without these frictions, existing-home sales easily would be well above the 5-million unit pace,” he said. “Buyer traffic is 31% stronger than a year ago, but sales are running only about 10% higher.” Existing-home sales are at the highest pace since November 2009 when the market spiked to 5.44 million in response to the home buyer tax credit.
Of course, all real estate is local. This upswing in national sales resulted in a national median price of $192,000 for April. Translating that to the Flagstaff market, where the median price for April existing home sales was $260,000, requires some careful, professional analysis – for both Flagstaff home sellers and Flagstaff home buyers. When you’re ready to do either, contact the Flagstaff Elite Team at RE/MAX Peak Properties.
By the way, I love this week’s MarketWatch.com weekly graphic of economic indicators, entitled, See How Low Inventories Are Juicing Home Prices – The Week in Charts.
Here’s economist Laurence Yun’s monthly talk on existing home sales.
Another note of good news (this is clearly a trend): Foreclosures and short sales accounted for 18% of April sales, down from 21% in March and 28% in April 2012.